NOL stays in the red, port congestion hits liner arm APL

Revenues for the third quarter were flat at $2.06bn. For the first nine months of 2014 NOL lost $174m, compared to a $61m profit in the same period last year that included a one time gain from the sale of its headquarters building.

NOL claimed cost savings of $290m so far this year but these had been “largely offset” by lower rates, lower volumes and increased costs for port congestion.

“Our focus on increasing operational efficiencies remains on track,” said NOL group ceo Ng Yat Chung. “However, our liner business faced tough operating conditions in the second and third quarters due to severe port congestion in Southern California, and this has negatively impacted our financial performance.”

Core EBIT for liner business APL improved to $6m compared to $3m a year earlier. However, APL president Kenneth Glenn said port congestion in Southern California had impacted its results.

“Unfortunately, the industry-wide port congestion issues in Southern California have adversely impacted our performance,” he said.

“Given APL’s significant business presence in Southern California, we are working simultaneously on several fronts to urgently address these issues This includes realigning our network to facilitate smooth cargo flow through the US West Coast, and working with our partners on equipment and productivity challenges.”

APL Logistics reported a core EBIT of $15m for the third quarter. The profitable logistics business is reportedly up for sale although NOL has previously downplayed the reports.

Korean stock exchange listed CJ Korea Express said earlier in the month it was reviewing a possible buy of APL Logistics.

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